When it comes to investment opportunities, Europe seems to be the top choice for many investors. According to the Milken Institute’s Global Opportunity Index (GOI) report, four out of the top five favorite destinations for investors are in Europe. Denmark, in particular, was at the top of the rankings this year, scoring first on business perception and other regulatory metrics. The index takes into account 100 indicators across five categories, including business perception, economic fundamentals, financial services, institutional framework, and international standards and policy.
The top five countries that investors find attractive, according to the latest GOI report, are Denmark, Sweden, Finland, United States, and United Kingdom. The United States moved up one spot to the fourth position this year, ranking highest in the institutional framework category, which evaluates the protection that a country’s institutions offer to investors’ rights and assets. Finland, which placed third overall, was ranked highest in the international standards and policy category.
The report also highlighted the growing investment opportunities in emerging and developing Asia. These regions drew more than half of the funds flowing into E&D countries between 2018 and 2022. While advanced economies provide stability, investors seeking high-growth returns continue to show interest in emerging and developing economies. Malaysia emerged as investors’ favorite in Asian E&D economies and ranked 27th globally. The country has the best investment conditions among all E&D economies, ranking well on institutional frameworks and having strong investors’ rights.
Despite the attractive investment opportunities in Asia, rising tensions between the U.S. and China have impacted inflows to Asian E&D economies, decreasing by 75.4% in 2022. China, the world’s second-largest economy, came in at 39th place in the Global Opportunity Index. The report noted that while China attracted more than half of the total capital inflows to E&D Asia between 2018 and 2022, its appeal to investors appears to have decreased recently due to geopolitical tensions with the U.S.
Some of the top E&D Asian countries on the Global Opportunity Index include Malaysia, Thailand, China, Indonesia, Vietnam, India, Mongolia, Sri Lanka, Philippines, and Cambodia. Singapore ranked as the favorite country for investors in Asia, grabbing the 14th place globally. Hong Kong and Japan followed closely, ranking 15th and 16th, respectively, in Asia.
While Europe remains a popular destination for investors, emerging and developing Asian countries are also attracting attention due to their growth potential. However, geopolitical tensions and other factors can impact investment flows and the attractiveness of certain countries. Investors need to carefully evaluate the risks and opportunities presented by different regions before making investment decisions.